ForexLive North American wrap: Weak factory orders, glimmers of hope in Europe

April factory orders -0.6% vs +0.2% exp Durable goods orders revised to 0.0% vs +0.2% prior ECB's Nowotny endorses banking union G7 to hold conference call on Europe on Tuesday Merkel's coalition says tools ready to protect banks Handelsblatt: Merkel prepared for 'burden-sharing' Merkel and Barroso discuss banking supervision Barclay's sees $800B Fed QE S&P sees 1-in-3 chance of Greek euro exit German foreign minister Westerwelle: austerity important but 'not everything' Canada's Flaherty has fiscal room to act Santander: Spanish banks need 40 billion euros (but not us) China Daily: China making plans in case of euro breakup S&P 500 flat at 1278, falls as much as 10% from high EUR leads, JPY lags Decent comeback in EUR/USD but nothing game-changing. EUR/USD opened at 1.2435 and rallied to 1.2497 in early US trading. It struggled with barriers at 1.25 for a short time before popping to 1.2510. It was a chop around 1.25 afterwards. The Treasury rally finally stopped with 10s climbing to 1.52%. That sparked modest USD/JPY buying; up to 78.36 from 78.20. AUD is in focus ahead of the RBA. Three options are on the table -- no cut, 25 bps or 50 bps. AUD/USD tripped buy stops above the post-NFP high of 0.9724 on a rally to 0.9747 but the sellers ahead of 0.9750 were evident, kicking it back down to 0.9693. Last at 0.9721.